Tag Archives: ab1665

CPUC urged to keep broadband promotion subsidies provider neutral


Broadband promotion grant rules should have air tight guarantees that the money won’t be used to promote any particular Internet service provider. That’s the consensus of several organisations that reacted to a draft decision that would have the California Public Utilities Commission set up a broadband “adoption” program, subsidised by the California Advanced Services Fund (CASF).

As the new rules were being developed, big, incumbent ISPs argued, in effect, that they should be able to leverage the money to supplement their subscriber acquisition – aka sales – efforts. The first draft of the rules is a little ambiguous on that point. Although the money would flow through (presumably) non-profit organisations, partnerships with ISPs are encouraged. No one seems opposed with the idea of working with ISPs. After all, the goal is to convince more Californians to buy Internet access and join the online world. ISPs have to be part of the mix for that to happen.

But exclusive deals are something else again. Big ISPs such as AT&T, Frontier Communications, Comcast and Charter Communications don’t play well with others. As anyone who has watched the parade of sock puppets that the big carriers march into legislative hearings can tell you, when they can rope non-profits into working for them, they will. In its comments to the CPUC, the California Emerging Technology Fund (CETF) said Frontier wants to do exactly that…

Currently, CETF is being pressured by Frontier Communications to have CBO grantees for adoption outreach market only Frontier’s affordable offer. This is contrary to the role of a non-profit organization to educate a potential subscriber to all affordable offers available, and help choose the best one for his or her needs.

Most of CETF’s funding comes from Frontier and Charter these days, to run such subscriber acquisition campaigns in their territories.

The Greenlining Institute, TURN (aka the Utility Reform Network, aka Toward Utility Rate Normalisation) and the CPUC’s office of ratepayer advocates also pushed for clear language banning exclusive deals between grant recipients and ISPs. As TURN and Greenlining put it

The Commission should ensure that those partnerships do not require digital literacy programs to exclusively promote one Internet Service Provider’s services at the expense of competition and informed consumer choice. These program participants are exceptionally vulnerable in that they have been recently introduced to the internet and on-line environment and presumably have little to no knowledge regarding the various options and “players” in the marketplace. These consumers will likely be looking to these programs for guidance and advice on adoption options. These consumers should not be misled or otherwise given the impression that they do not have a choice for internet services through program materials, branding, or other marketing materials solely from the ISP partner that would likely be accessible during the grant- funded program.

Rebuttals, should there be any, are due next week. The CPUC is scheduled to make a final decision on 21 June 2018.

The complete set of CASF reboot documents is here.

California broadband subsidy law demands equal treatment for all, rich and poor alike


One of the mysteries surrounding Californian subsidies for broadband infrastructure is the abysmally low standard that the California Public Utilities Commission imposes on the people who live in public housing, and only on them. The thicket of laws that govern the California Advanced Services Fund (CASF) initially set aside $20 million to pay for broadband facilities in public housing communities, with the possibility of adding more when it runs out.

The CPUC is in the middle of rebooting the CASF program, after the California legislature added to the mess by turning the general infrastructure subsidy program – with $300 million in new money – into a piggy bank for AT&T and Frontier Communications. In the process, it’s freshening up the rules for improving broadband access in public housing.

The first draft of the new rules keeps the minimum service speed for subsidised public housing broadband facilities at 1.5 Mbps for downloads, with no requirement at all for uploads. That contrasts with the 6 Mbps down/1 Mbps minimum that the CPUC (and the legislature) thinks is good enough for everyone else. It isn’t, but that’s a separate barrel of pork.

The draft rules justify digging a deeper digital divide by declaring subsidised broadband in public housing is “not intended to replicate the robust level of connectivity of a commercial provider”. The problem with that, as pointed out in comments filed yesterday by the Central Coast Broadband Consortium, is that the language of the law – sausage though it may be – sets the same standards for everyone…

Because 1. An unserved residence is one where service at 6 Mbps download and 1 Mbps upload speeds is not available, 2. Grants for broadband infrastructure projects in Public Housing may only be made to an unserved residence, and 3. The purpose of all CASF infrastructure projects is to raise the service available to all Californians above the statutorily defined unserved threshold, we must conclude that it would be illegal to fund an infrastructure project, of any kind, that did not provide service at 6 Mbps download and 1 Mbps upload speeds or better.

The CPUC is due to vote on the changes at its 21 June 2018 meeting.

The complete set of CASF reboot documents is here.

I drafted and filed the Central Coast Broadband Consortium’s comments. I’m not trying to feign impartiality. Take it for what it’s worth.

Correction: an earlier version of this post contained a typo. The minimum speed that CASF-subsidised broadband projects in public housing communities must “provide residents with” is “1.5 mbps per unit”, not 1 Mbps per unit. The fault is mine and it’s been corrected above.

CPUC offers plan to increase Internet use in communities that need it most


Disadvantaged communities are first in line for broadband education, marketing and access grants subsidised by the California Advanced Services Fund (CASF) in a draft plan to implement a new “adoption” program run by the California Public Utilities Commission. The proposed decision, by commissioner Martha Guzman Aceves, also tweaks existing subsidies for broadband service and promotion in public housing communities and winds down a defunct infrastructure loan program.

Two kinds of adoption projects will be funded: digital literacy – i.e. training and marketing – efforts and broadband access programs that offer free Internet access and computer centers.

The proposed rules favor big projects. Grant proposals up to $100,000 will get expedited treatment – staff can say yes or no, without spending months on a formal vote by commissioners.

The draft has a simplified checklist that CPUC staff will use to rank proposals. Communities where annual median income is at or below $49,200 or where half the residents have limited English ability or have “only a high school diploma or less”, or have “some other demonstrated disadvantage which affects broadband adoption” will get priority. So will rural areas and projects that have community support and/or partnerships, and offer low or no cost Internet access.

The big telephone and cable companies wanted these programs to be tilted in their direction. Frontier thought those programs should be linked to its CASF-subsidised infrastructure projects, while the lobbying front for Comcast and Charter Communications – the California Cable and Telecommunications Association – gushed over the idea that grants should be tied to “partnerships” with incumbents, albeit non-exclusively. Guzman Aceves rejected Frontier’s cash grab, and broadened the allowable range of partnerships to include local community groups, non-profit and for-profit companies and any “other applicable organisation”. Incumbents can still play, but they don’t get a privileged position.

The public housing program was left largely unchanged. Cable company lobbyists failed to insert additional roadblocks. Service levels for subsidised broadband facilities in public housing communities are still pitifully poor, with a minimum download speed of 1.5 Mbps and no standard at all for upload speed.

The draft also closes down the broadband infrastructure loan program, which was scrapped by the legislature last year. Existing loans will continue as is, and the two pending loan applications will be converted to grants.

The schedule calls for the CPUC to vote on the proposed decision at its 21 June 2018 meeting, with the first round of applications accepted on 1 July 2018. Comments on the draft are due on 7 June 2018.

The complete set of CASF reboot documents is here.

CPUC posts proposed new rules for Internet adoption, public housing broadband grants


This morning, commissioner Martha Guzman Aceves released a draft plan for giving out grants to broadband adoption programs, revising an existing grant program that pays for broadband facilities in California’ public housing communities, and winding down a defunct broadband infrastructure loan account. You can read it here:

Proposed decision by commissioner Martha Guzman Aceves, implementing CASF broadband adoption program and modifying the CASF public housing broadband and infrastructure loan programs, 18 May 2018

You can find the background documents here.

I haven’t read through it all yet, so I’ll reserve comment until Monday. Enjoy your weekend!

Pay top dollar for low speed broadband, CPUC told


The counter punches landed at the California Public Utilities Commission yesterday, as nine organisations filed rebuttals to previous comments about how the California Advanced Services Fund (CASF) should be run. The broadband infrastructure subsidy program is undergoing a complete make over, thanks to last year’s assembly bill 1665, which lowered California’s minimum broadband speed standard and turned the fund into a piggy bank for AT&T and Frontier Communications.

The Central Coast Broadband Consortium’s reply, which I drafted and submitted, led off with a correction – I got the math wrong on service level weightings. We recommended using the Federal Communications Commission’s discounting criteria, which is based on download/upload speeds and latency, for determining how much of a project is subsidised. The corrected table is below.

That proposal drew fire from AT&T. It wants full funding for low speed, 10 Mbps down/1 Mbps up wireless service, claiming it “provides capabilities that are more than sufficient to meet the broadband needs of a typical household, even with multiple simultaneous users”. Sure. So long as that typical household hasn’t bought a new television recently. Half of U.S. homes will have a 4K set by the end of next year, well before AT&T completes any CASF-subsidised upgrades. Those require at least 15 Mbps of steady service just to watch one 4K program.

Likewise, the California Emerging Technology Fund (CETF), which sponsored AB 1665 and successfully lobbied governor Jerry Brown to sign it, scoffed at the idea of basing CASF subsidies on infrastructure quality and performance, comparing it to rearranging deck chairs on the Titanic.

Thus spoke the iceberg.

CETF and AT&T phrased it differently, but both arguments lead to the same conclusion: lock rural California into slow and unreliable service – insufficient even by today’s standards – for decades to come. That’s not good enough. If service providers get public subsidies, they should build what all Californians need, now and tomorrow.

The full list of CASF-related comments and reply comments is here.

Big incumbents tell CPUC to tilt California broadband subsidies in their favor


Four Internet service providers, all of whom have participated at one time or another in the California Advanced Services Fund (CASF) infrastructure subsidy program, offered their ideas on how that money should be managed and allocated. So did a lobbying front representing cable companies – including Charter Communications, Comcast and Cox Communications – which have never participated. The big boys – AT&T, Frontier Communications and the cable industry – want grants on their own terms, while blocking competitors that might threaten their monopoly business models.

AT&T offered a long list of suggestions to the California Public Utilities Commission. Some had merit, for example including latency as an evaluation criterion for project funding and measuring project reach by total housing units, whether occupied or not. Others were self serving. AT&T heartily endorsed the idea of limiting project proposals to once a year – great for a large, bureaucratic organisation like itself (or even a medium sized one like the CPUC) but hellish for nimble competitors. It also wants the CPUC to not do any ground truthing and simply rely on AT&T’s service claims. Given AT&T’s inaccurate reporting, that would hardly be a benefit to communities that AT&T doesn’t consider to be high potential.

Frontier Communications essentially told the commission that it should just give it as much money as it wants, on demand. After all, what’s a piggy bank for if you can’t whack it with a hammer any time you’re running short?

Geolinks wants the commission to give wireless infrastructure proposals the same weight as fiber projects, arguing nonsensically that they “will likely offer the same speeds”. It’s a wireless Internet service provider that hasn’t applied for CASF grants but did try unsuccessfully to jump in via the commission’s right of first refusal process.

Race Communications has received several CASF grants and understands the process well, including the endless opportunities for incumbents to game the system and delay, or even kill, competitive projects. It makes several useful recommendations to streamline the CASF program so that it doesn’t favor companies, such as AT&T and Frontier, that have all the lawyers and lobbyists they need to create mischief.

The California Cable and Telecommunications Association (CCTA), which speaks for Comcast, Charter and Cox, among other cable companies, wants to slow the grant approval process down, opposing expedited reviews. Its major members have refused to participate in the CASF program in the past, because of the regulatory danger they perceive. Grants for independent middle mile projects, which are largely banned now by state law because of its own lobbying efforts and those of AT&T and Frontier, also drew CCTA’s attention. It wants the CPUC to make sure none slip through any loopholes.

The full list of CASF-related comments is here. The CPUC will accept rebuttals, the deadline is 1 May 2018.

California broadband subsidy rules and $300 million on the table


The main event is finally under way. By yesterday’s deadline, thirteen organisations filed comments regarding how the California Public Utilities Commission should spend $300 million in new California Advanced Services Fund (CASF) money (plus however much more is left in the kitty) on broadband infrastructure subsidies. I haven’t read through them all yet – if you’re interested, I’ve posted them all here – but a top line glance shows that service providers, including the big incumbents who expect to use CASF as a private piggy bank, have a lot to say.

So do regional broadband consortia, and organisations that usually jump in on broadband issues. Yesterday’s round of comments focused mostly on broadband infrastructure grant rules, including the new $5 million line extension program that cable companies lobbied for – they want to evade CPUC oversight by laundering grant money through homeowners.

I drafted and submitted the Central Coast Broadband Consortium’s comments (with much appreciated distribution help from Trish Steel at the Mendocino Broadband Alliance). Our one big recommendation is to base infrastructure grant amounts on the level of service that the subsidised infrastructure will provide…

The CCBC recommends that the Commission…add one further criterion for determining the level of funding: the service level that a proposed project is capable of delivering and that the applicant commits to offering and fulfilling for at least two years following project completion.

In the Connect America Fund II auction phase, the Federal Communications Commission (FCC) has established “technology-neutral service tiers” and other service level metrics that will determine project eligibility and, effectively, the level of funding…the weighting used by the FCC for the various speed tiers can be applied to funding level decisions made by the CPUC. The CCBC recommends setting a base funding level of 80% of project costs and applying the FCC’s weighting criteria…

We made a similar recommendation for the line extension program, with the addition of suggested cost sharing and oversight requirements for the ultimate beneficiaries – the Internet service providers, including cable companies, who will own the infrastructure and bill homeowners for the service it supports.

Comments were also due on proposed changes to the CASF-funded regional broadband consortia program. California lawmakers approved a long wish list submitted by AT&T, Frontier and cable companies such as Comcast and Charter Communications that use a front organisation to do most of their public lobbying (the real lobbying, involving millions of dollars in cash payments from telecoms companies to legislators, is done behind closed doors of course). One of the lesser items on that list was restrictions on what regional consortia can do with the CASF money they get. We urged the commission not to take a narrow view of what those restrictions mean.

I’ll more to say about all comments as the week goes on and I make my way through them. Rebuttal comments are due in a couple of weeks.

Streetlight gifts to mobile carriers spread to other states


California is not the only state where lobbyists for mobile carriers and other big, incumbent cable and telephone companies are giving stacks of cash offering somber advice to state legislators and getting huge gifts of public property in return. According to a couple of articles by Timothy Clark in Route Fifty, several other states are preempting local ownership of vertical infrastructure and municipal control of public right of ways.

In some states, the giveaway is even more generous than the California’s gift to telecoms lobbyists last year, senate bill 649. It was vetoed by governor Jerry Brown, who eased the pain by reinforcing AT&T’s and Frontier Communications monopoly in rural California with $300 million and, effectively, an end to similar subsidies for independent broadband projects. SB 649 would have set a blanket $250 a year lease rate for wireless broadband providers to attach cell sites and other equipment to city owned street lights. Depending on how you figure it, that’s something like one-fourth to one-half of the market rate.

In Texas, lawmakers went one better and sliced off a zero, setting the maximum municipal pole lease rate at $20 a year. The City of McAllen, Texas sued, claiming that the preemption violated the Texas constitution. McAllen is no stranger to fighting for municipal broadband rights, by the way. It drafted a “minority report” protest to the Federal Communications Commission over the way that industry lobbyists hijacked the Broadband Deployment Advisory Committee, and convinced San Jose and New York City to sign on.

According to Clark’s story

“In our legal analysis,” [McAllen city attorney Kevin Pagan] said, “the law forces us to give gifts to private parties. It is forcing us to give access to our rights-of-way at far less than market value. What about other companies using the rights of way? They are paying higher rates, and why wouldn’t they say, ‘What about us?’”

The wireless telecom companies, he continued, “want access to the rights of way like public utilities, but they don’t want to be regulated like a public utility.” Pagan noted while the companies promote small-cell as cutting-edge wireless technology, the cells rely on a vast fiber cable network that comprises 90 percent of the system, largely strung on poles in the rights of way.

Georgia lawmakers also passed similar legislation, and a preemption bill is making its way through the Nebraska legislature.

AT&T, Frontier, Comcast, Charter want benefit of California’s broadband promotion grants, but not responsibilities


In the spirit of no taxpayer dollars left behind, big cable and telephone companies want to help spend grants awarded by the California Public Utilities Commission to groups promoting Internet use and subscriptions, but they don’t want to have do anything in return. Cable companies and AT&T filed rebuttals last week to recommendations made by a variety of broadband and consumer advocacy groups about how a “broadband adoption” grant program, newly funded by a tax on telephone bills, should be structured. Frontier Communications offered similarly self-serving comments last month.

Comcast’s, Charter Communications’ and Cox Communications’ lobbying front – the California Cable and Telecommunications Association (CCTA) – wants to leverage adoption grants, but doesn’t want to accept any responsibility that might go along the money, or cooperate with groups that get it. It endorsed the California Emerging Technology Fund’s (CETF) recommendation that organisations should be able to receive grants in partnership with incumbents. That’s not surprising, since Charter is paying millions of dollars a year to and through CETF for adoption – aka subscriber acquisition – campaigns. But CCTA doesn’t think its members should have to provide any information about results, even though it forcefully argues that grant recipients should be held accountable for those results, nor does it favor requirements that Comcast and Charter better advertise the low income discounts they, in theory if not always in practice, offer.

AT&T faithfully echoed CCTA’s comments. It’s tempting to think they coordinated their responses, but the monopoly business models of telcos and cable companies are so closely aligned that it would be remarkable if they didn’t agree. Like the cable companies, AT&T doesn’t want to disclose the number or location of their subscribers or share any customer information. But, also like the cable companies, it wants to take advantage of any subscriber acquisition benefits that might flow from the CPUC’s adoption grant program, particularly any opportunities to push its marketing message. “We clearly share the goal of maximising knowledge, and adoption, of our plans”, AT&T’s filing said.

Assuming the CPUC follows its published timeline, draft rules for the broadband adoption grant program will be posted in May 2017, with a final decision coming in June.

Phase 1 Reply Comments – filed 2 April 2018

California Cable and Telecommunications Association
California Emerging Technology Fund
North Bay North Coast Broadband Consortium
Office of Ratepayer Advocates
The Utility Reform Network and the Greenlining Institute

Click here to see California Public Utilities Commission documents, public comments and reply comments, and other information regarding the 2017-2018 overhaul of California Advanced Services Fund programs.

Should California broadband subsidies backfill big telco, cable marketing budgets?


When lobbyists for telephone and cable companies convinced biddable lawmakers to turn California’s taxpayer-funded broadband subsidy program – the California Advanced Services Fund (CASF) – into their own private, $300 million piggy bank last year, some smaller programs were included. Assembly bill 1665 created a $20 million “broadband adoption” kitty that’s supposed to go toward increasing the number of people who use the Internet. The California Public Utilities Commission is writing new rules to guide how that money is spent, and many organisations, incumbents and non-profit corporations included, have offered recommendations for doing so.

In the latest round of comments, two consumer advocacy groups, the Utility Reform Network (TURN) and Greenlining, hit back at the suggestion that broadband adoption programs – digital literacy classes, broadband access efforts such as computer centers and equipment giveaways, and other marketing initiatives – should, or at least could be, used to fund “partnerships between grantees and incumbent Internet Service Providers”. The money would, in effect, supplement incumbents’ marketing budgets. That recommendation was made by the California Emerging Technology Fund, which is a non-profit organisation largely funded these days via adoption programs paid for by Charter Communications and Frontier Communications.

The two groups pointed out that incumbents – a gang that includes Charter, Frontier, AT&T and Comcast – have reduced-rate broadband programs for low income households. They’re required to offer those rates as a condition imposed on them by regulators when they bought up other companies…

Those merger requirements have end dates and it is unclear whether any of those incumbent providers will continue to provide a low-income broadband service option after the merger requirements expire.

It is also critical that applicants do not use the CASF grant money to advantage a particular carrier. While partnerships should be allowed and can have value, they cannot be designed to provide an exclusive channel for the carrier-partner to otherwise upsell services, provide unsatisfactory services, or provide broadband with short-term discounts that may expire.

Applications that propose partnerships should be closely reviewed and the Commission should allow “well-meaning and laudable” start-ups and smaller broadband providers, who have identified a need to close the digital divide in their communities and want to take action to help their communities, to apply for CASF funds.

Just so.

Assuming the CPUC stays on schedule, the requirements for the new broadband adoption grant program should be finalised by the end of June 2017.

Phase 1 Reply Comments – filed 2 April 2018

California Cable and Telecommunications Association
California Emerging Technology Fund
North Bay North Coast Broadband Consortium
Office of Ratepayer Advocates
The Utility Reform Network and the Greenlining Institute

Click here to see California Public Utilities Commission documents, public comments and reply comments, and other information regarding the 2017-2018 overhaul of California Advanced Services Fund programs.